During his hourlong State of the Union speech last month, President Joe Biden proclaimed the “auto jobs of the future” will be “here in America!” The president was right to point to the importance of the American auto industry, but he failed to mention that his policies are helping China dominate global auto manufacturing.
China has been after such dominance for some time. The Chinese government regularly inundates Chinese automakers with subsidies, financing incentives, tax breaks, stolen intellectual property, and even slave labor to make them more competitive. As recently as 2009, the effects were limited. Chinese vehicles remained second rate, and they rarely left the Chinese market. Today, however, Beijing’s non-market policies are paying off in a big way.
Through heavy investment in research and development, China has improved the quality of its products and quadrupled its auto exports since 2020. It surpassed Japan as the world’s biggest auto exporter in 2023. China’s ascent is especially pronounced in the market for electric vehicles, which the Chinese Communist Party identifies as one of the “new three” products, together with solar panels and advanced batteries, that it seeks to export to the world.
Chinese vehicles have yet to meaningfully penetrate the United States, but it is only a matter of time before Chinese automakers are able to absorb our tariffs. This is a massive threat, not just because of the auto industry’s symbolic role in the U.S. economy, but because vehicles and vehicle parts still contribute more to our exports than any other industrial products.
So, what are our leaders doing to keep America competitive? For Biden, the answer is “not much.” In fact, the president is strengthening China’s hand, primarily because he is actively trying to ban the auto industry’s most vital sector: cars with internal combustion engines.
Regardless of what Democratic climate activists prefer, nine out of every 10 cars made in America run on gas. These vehicles are also the only profitable cars made in America, even when you factor in federal subsidies. Yet Biden’s new tailpipe emissions rule is designed to cripple this highly productive sector, thereby forcing consumers to buy EVs.
Meanwhile, the Democrats’ Inflation Reduction Act has authorized billions of dollars’ worth of tax credits and grants for EVs. Even here, though, Biden is putting American automakers second. Specifically, he is waiving “Buy American” requirements for EV chargers, meaning U.S. taxpayers are funding the deployment of Chinese charging stations across the country.
If this sounds bad, it is about to get far worse. Chinese auto companies are setting up shop in Mexico, where they hope to use the U.S.-Mexico-Canada Agreement to bypass our tariffs entirely. U.S. companies are already raising the alarm about what’s coming, calling China’s backdoor in Mexico an “extinction-level” threat. Former President Donald Trump rightly predicted it could precipitate a “bloodbath” for the industry.
This danger is so pronounced that even the Biden administration recognizes it cannot be seen doing nothing. Accordingly, Commerce Secretary Gina Raimondo has announced a federal investigation into security risks associated with the computer systems in Chinese EVs. But this is a thin veil for inaction.
It looks like it is up to Congress to force the president’s hand. That’s why on March 5, I introduced three bills to protect American automakers. The first would treat vehicles produced by a foreign adversary as if they originated in that adversary’s territory. This would prevent Chinese auto companies from weaseling their way out of tariffs by moving production to another country, such as Mexico.
The second bill would impose a flat tariff of $20,000 on all Chinese vehicles so that even China’s most heavily subsidized models price comparably with cars made by the United States and allied countries.
The third bill, meanwhile, would require all vehicles that receive U.S. EV production benefits to comply with the USMCA’s strict rules-of-origin and labor content criteria. This would render Chinese companies ineligible.
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Together, these bills would level the playing field for our domestic auto industry. Will Biden and my colleagues in Congress support them? For the sake of our automakers and the workers who depend on them for their livelihood, I hope the answer is “yes.”
“Scranton Joe” has branded himself a pro-worker Democrat. Unless he also wants to brand himself a hypocrite, the president must stop subsidizing our adversaries’ factories for the sake of the “green transition” fanatics in his base and instead enforce tariffs on all Chinese vehicles, not just EVs.
Marco Rubio is the senior U.S. senator for Florida.